PRECIOUS metals prices fell across the board yesterday , with silver tumbling 10%, as oil fell in the wake of the Organisation of Petroleum Exporting Countries’ (Opec’s) decision to defer a production cut, and the dollar strengthened against the euro.
Gold slipped more than 4% to its weakest level since November 21, while platinum and palladium tumbled 8% each as investors fretted over the outlook for demand.
Spot gold hit a session low of $776,80/oz and was quoted at $782,80-$785,30 by mid-afternoon, down from $813/oz on Friday.
Silver fell to a low of $9,15 and was later trading at $9,35-$9,43, down from $10,26 on Friday. “Gold was already weaker this morning in Asia on falling oil prices, and as crude oil accelerated its decline in European trading and the start of trading in the US, gold came under pressure,” Peter Fertig of Dresdner Kleinwort said.
“Furthermore European PMIs came in weaker than expected so pressure on the euro increased and stock markets came under heavy selling pressure, which is another negative factor for the precious metals.” Oil prices fell more than 7% after Opec opted to wait until mid-December to cut output at a meeting at the weekend. Gold tends to move in line with crude because it is bought as a hedge against oil-led inflation. Reuters
